AMERICA suffered a spasm of fear and alarm yesterday as two reports of terrorist activity rapidly gained credibility.

The discovery of white powder on the Pennsylvania Avenue pavement outside the White House caused a section of central Washington to be cordoned off by police who put in progress a full-scale terrorist alert.

Tests subsequently showed the substance to be harmless. The initial reaction had been such that a Homeland Security spokesman was obliged to issue a statement declaring the powder to be "benign".

In New York the stock market dipped after an inaccurate report appeared on the ABC News website citing an unnamed US intelligence source as having given warning of an "imminent credible threat" to a Manhattan landmark by "a woman suicide bomber". Police rapidly issued a denial.

In an interview in yesterday's New York Times the head of the commission investigating the September 11 attacks said they could have been averted, had the FBI, immigration and other officials done their job properly. Thomas Kean said investigators were still studying whether senior figures in the Bush Administration should share the blame.